Non-Disclosure Agreement

A non-disclosure agreement (NDA) can protect your confidential information in an employment situation, when discussing a possible joint venture or the sale of your business or when you need to disclose information about your invention.

You do not need a confidentiality agreement when consulting with or disclosing information to your lawyer or patent attorney because they are legally bound to keep all client information in the strictest of confidence.

envelope with confidential information

If however, you need to discuss your invention with someone before you apply for a patent, such as a machinist to help you build a prototype, or engineer who will help with the specification document or investor who will assist with funding, it is vital to have a non-disclosure agreement in place.

Remember that it is a requirement for a patent to be new i.e. not publicly known or previously disclosed, to qualify for patent registration, unless such disclosure was made "in confidence".

SIDEBAR: For employment of business situations you could use the following when you need to disclose confidential information:

Employee Confidentiality Agreement

Financial Confidentiality Agreement - for disclosure of financial statements when selling a business.

Whatever information you choose to disclose about your invention, it is best to do so in writing and to clearly mark such information (including samples, drawings, plans, descriptions etc.) as "CONFIDENTIAL" to avoid disputes about the nature of the information. It is also a good idea to add the date of disclosure on such material.

For example, if during discussions you orally disclose additional information not recorded as yet, you can minute such information in writing and ask the recipient to acknowledge receipt thereof. This is not a legal requirement though but good practice!

An NDA can be "one-way" - where only one party discloses information, or "mutual" - where both parties exchange confidential information.

The invention confidentiality agreement following here is drafted as a one-way agreement. You could sign an NDA prepared by the other party if they too will be disclosing their confidential information. You can replace the word "Inventor" in our template with "Disclosing Party" if you prefer.

Our sample non-disclosure agreements provided here are for informational purpose only and you must consult with legal counsel for advice and assistance.

Non-disclosure Agreement

The parties to this Agreement are:

___________________________
(Hereinafter referred to as the "Inventor")

and

___________________________
(Hereinafter referred to as the "Receiving Party")

Purpose of Disclosure:

(Hereinafter referred to as the "Purpose")

1. Confidential Information

The Confidential Information as disclosed by the Inventor, who warrants his/her legal right to do so, are described as follows:

Any additional disclosure of Confidential Material made orally or in any other manner shall be reduced to writing and delivered to the Receiving Party within thirty (30) days of disclosure and shall be clearly marked as Confidential.

Upon written request by the Inventor any and all copies and records of the Confidential Information shall be promptly returned by the Receiving Party to the Inventor.

2. Obligations of the Receiving Party

The Receiving party undertakes:

a) To keep all information and materials and models disclosed by the Inventor in strictest confidence and not to use any such information and materials for any use but the Purpose as described in this Agreement, unless obliged by law to do so or with prior written permission by the Inventor.

b) To keep all Confidential Information secure and only to disclose it to another party who need to know for the Purpose and to bind such other parties by the same non-disclosure obligation as contained in this Agreement.

c) To regard all information disclosed in whatever form by the Inventor as confidential, except for the following:

i) Any information or materials which are in the public domain or become publicly known in future through no breach of this Agreement by the Receiving Party.

ii) Any information or materials shown to be known to the Receiving Party prior to disclosure by the Inventor, or which the Receiving Party has learned, created or discovered independently or through legitimate means from a source who has no duty of confidentiality to the Inventor.

d) To remain bound by the non-disclosure provisions of this Agreement until released in writing by the Inventor or until the Confidential Information no longer qualifies to be defined as such in law.

3. Relationships

Nothing in this Agreement shall be construed as creating a contractual relationship of any nature at present or in future between the parties beyond the disclosure of information and the purpose thereof, nor shall either party be liable or obliged to the other, nor grant any Intellectual Property rights, licence or interest in the information and materials disclosed.

4. General

a) This Agreement constitutes the entire and exclusive agreement between the parties with respect to the subject matter hereof and any amendment shall not be valid unless made in writing and signed by both parties.

b) This Agreement shall be governed and construed in accordance with the laws of the State of ____________ and the parties consent to settle any and all disputes in a court of competent jurisdiction in the State of ________ where after the prevailing party shall have the right to collect all reasonable attorney fees and costs from the other party.

c) If any of the provisions in this Agreement are judged to be invalid or unenforceable, it shall not affect the remaining provisions of this Agreement.

Recipient of Confidential Information

Name: _________________________ Title: ___________________

Address: _______________________________________________

Signature: _________________________ Date: _______________

Inventor

Names: ________________________________________________

Address: _______________________________________________

Signature: _________________________ Date: _______________

***

We've made provision in paragraph 1. of our Non-disclosure Agreement for a description of the Confidential Information. This can include information or materials such as drawings, diagrams, ideas, projected costs and profits, marketing plans, prototypes etc.

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